Explosion In Data-Centers And Memory Costs Fueling Third Inflation Wave
ZeroHedge ·
Explosion In Data-Centers And Memory Costs Fueling Third Inflation Wave We're finally starting to see hints of relief when it comes to inflation. Prices at the pump are starting to come down, monthly core CPI momentum has slowed, used cars were down around 2% YoY, and food inflation is starting to moderate. On the other hand, there's America's massive explosion in artificial-intelligence infrastructure - which is beginning to push prices up on everything from electricity to smartphones. On Thursday Apple announced a 15-25% price hike on Mac computers and iPads, after CEO Tim Cook told the Wall Street Journal that the jump in costs was unlike anything he had seen "in any area in over 40 years." An Apple spokesperson placed the blame on the " rapid expansion of AI data centers , which has created an extraordinary surge in demand for memory and storage," causing component prices to surge. Elon Musk agrees... Tim Cook, who told The Wall Street Journal that the jump in costs was unlike anything he had seen “in any area in over 40 years.” Biggest price jump in anything I’ve ever seen too. https://t.co/aypJGgssnN — Elon Musk (@elonmusk) June 25, 2026 As the Wall Street Journal notes; The money pouring into the AI arms race is unprecedented . Analysts peg capital spending at five of the so-called hyperscalers—Alphabet, Amazon, Meta Platforms, Microsoft and Oracle—at $741 billion this year, according to FactSet, up nearly 75% from last year. Where is all that money going? While much of the conversation is focused on what AI can do, the build-out itself is strikingly physical, said Columbia University economist Stijn Van Nieuwerburgh. -WSJ AI data centers require specific, sophisticated equipment to ensure cool, stable operation - as well as electric and fiber-optic cables and backup generators in order to keep them running 24-7. According to the report, Van Nieuwerburgh estimates that the AI buildout could cost somewhere in the range of $8 trillion over the next six years. A
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